Currency News [October 2, 2023]

The Cedi’s struggles against the American greenback continued unabated at the week’s open as the local currency posted a relatively bigger margin of decline at this week’s opening compared to previous weeks’ performances. The Cedi’s woes against the Dollar intensified following a recent global strengthening of the Dollar against other major international peers. The Cedi, however, garnered some resilience to extend its weekly gains against the Pound and the Euro on the Bank of Ghana (BoG) inter-bank trading platform.

The Cedi which has remained relatively stable since the second quarter of the year is expected to be pressured going into the last quarter of the year as demand for forex by importers begins to pick up. We expect the Cedi to continue to maintain its relative stability on the back of anticipated inflows to shore up the nation’s forex reserves from the cocoa syndicated loan proceeds as well as the second tranche of disbursement of USD 600.0 under the IMF’s Extended Credit Facility. The Central Bank’s interim intervention on both the spot and forward forex market for bulk oil distribution companies is expected to continue to sustain the local unit in the near term.

On the BoG inter-bank trading platform, the Cedi lost by 0.66% against the Dollar, having begun the week trading at GHS 11.1548 from last week’s opening trade value of GHS 11.0813. The Dollar was strengthened against its peers after the U.S. government avoided a shutdown and economic data again supported the view that the Federal Reserve will keep interest rates higher for a longer period of time. Against the Pound and the Euro, the Cedi strengthened by 0.10% and 0.29% to begin the week at trade values of GHS 13.5240 and GHS 11.7061 from last week’s opening trade quotes of GHS 13.5381 and GHS 11.7396 respectively.

On the Open Forex Market (oanda.com), the Cedi weakened by 0.84% and 0.22% against the Dollar and the Pound after it traded at GHS 11.6286 and GHS 14.1296 at the week’s open from last week’s opening trade values of GHS 11.5323 and GHS 14.0992 respectively. The Cedi, however, extended its impressive run against the Euro as it posted 0.02% appreciation, having traded at GHS 12.2451 at the week’s open from GHS 12.2476 at the start of last week. The single currency suffered a fierce September selloff that extended into the new month following fresh signs of economic trouble in Europe.

The Cedi was quoted at GHC 8.5903 on the first trading day of the year against the Dollar and is currently being sold at GHS 11.1548 indicating a YTD loss of 29.85% on the BoG inter-bank trading platform. It is also presently being quoted at GHS 11.6286 on the Open Forex Market (oanda.com) after opening the year at GHS 10.0825 indicating a YTD loss of 15.33%.